Correlation Between Inocycle Technology and First Media
Can any of the company-specific risk be diversified away by investing in both Inocycle Technology and First Media at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Inocycle Technology and First Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inocycle Technology Tbk and First Media Tbk, you can compare the effects of market volatilities on Inocycle Technology and First Media and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Inocycle Technology with a short position of First Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inocycle Technology and First Media.
Diversification Opportunities for Inocycle Technology and First Media
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inocycle and First is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Inocycle Technology Tbk and First Media Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Media Tbk and Inocycle Technology is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Inocycle Technology Tbk are associated (or correlated) with First Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Media Tbk has no effect on the direction of Inocycle Technology i.e., Inocycle Technology and First Media go up and down completely randomly.
Pair Corralation between Inocycle Technology and First Media
Assuming the 90 days trading horizon Inocycle Technology is expected to generate 4.78 times less return on investment than First Media. In addition to that, Inocycle Technology is 1.14 times more volatile than First Media Tbk. It trades about 0.0 of its total potential returns per unit of risk. First Media Tbk is currently generating about 0.01 per unit of volatility. If you would invest 10,100 in First Media Tbk on September 2, 2024 and sell it today you would lose (400.00) from holding First Media Tbk or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Inocycle Technology Tbk vs. First Media Tbk
Performance |
| Timeline |
| Inocycle Technology Tbk |
| First Media Tbk |
Inocycle Technology and First Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inocycle Technology and First Media
The main advantage of trading using opposite Inocycle Technology and First Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inocycle Technology position performs unexpectedly, First Media can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in First Media will offset losses from the drop in First Media's long position.| Inocycle Technology vs. MNC Vision Networks | Inocycle Technology vs. Hartadinata Abadi Tbk | Inocycle Technology vs. Kencana Energi Lestari | Inocycle Technology vs. Bali Bintang Sejahtera |
| First Media vs. Indosat Tbk | First Media vs. XL Axiata Tbk | First Media vs. Energi Mega Persada | First Media vs. Bakrie Brothers Tbk |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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